Category Archives: Housing Market

Hot Real Estate Market Continues in August

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WRA logo

Date: September 23, 2013

MADISON, Wis. ? Home sales and median prices both grew at a healthy pace in August, continuing the hot real estate market in Wisconsin, according to the most recent housing report from the Wisconsin REALTORS? Association (WRA). Existing home sales were up 13.7 percent in August compared to last August, closing out a very strong summer for home sales and 26 straight months of sales growth. Home prices showed similar strength with the median price rising 6.3 percent to $152,000 in August. Median prices have been up 17 of the last 18 months.

?This has been a very strong summer for home sales, which is important for a state like Wisconsin where there are strong seasonal sales patterns,? said Steve Lane, broker with First Weber Group REALTORS? in Stevens Point and the new Chairman of the WRA board of directors. He noted that in a typical year, about 42 percent of home sales in the state take place between May and August. ?We started the year strong, and we?ve carried that momentum through the summer, which bodes well for the remainder of the year,? he said.

Existing home sales were up in every region of the state, with five of the six regions growing by 9.9 percent in August compared to August 2012. The area with the fastest growth over August 2012 was the Central region, which was up 23.2 percent. Also up by substantial margins were the South Central, increasing 18.4 percent, and the Southeast, growing 14.5 percent compared to August last year. The West was up 11.1 percent, and the Northeast grew 9.9 percent over the period. Finally, home sales in the North were up 5.6 percent compared to last year. ?While it?s not uncommon to see some volatility in sales in the northern and central parts of the state due to the large number of second homes in those areas, the more urbanized regions are more stable and were consistently strong in August,? said Lane.

Wisconsin?s median home prices grew at a solid pace between August 2012 and August 2013, increasing 6.3 percent to $152,000. This continues a trend that began in March last year and mirrors national trends of rising home prices. ?Our appreciating home values are due to a combination of moderate job growth, shrinking inventories and the fact that the there is less shadow inventory of potential foreclosures, which was depressing home prices in the immediate aftermath of the recession,? said Michael Theo, WRA President and CEO. On the job front, Wisconsin added 108,700 jobs since nonfarm employment bottomed out in February 2010, according to seasonally adjusted data reported by the U.S. Bureau of Labor Statistics. This job expansion includes employment growth of about 24,100 jobs since January 2013.

?While the most recent employment data are still preliminary and subject to revision, they do paint a positive picture of state job growth and suggest we?re moving in the right direction,? said Theo.

Statewide, there was 10 months of available inventory on the market in August, which is down from 12.4 months in August 2012. ?Inventories are even lower in the urban areas, which has put upward pressure on prices in those cities,? Theo said. Inventories in the metropolitan counties are at just 7.5 months. ?Finally, we?ve made real progress in liquidating foreclosed properties in the state,? he said. Through the first half of the year, Wisconsin foreclosures were down 37.2 percent compared to the first half of 2012.

The Wisconsin Housing Affordability Index, which stood at 215 in August, still indicates that housing remains affordable in the state. The index shows the percent of the median-priced home that a buyer earning the estimated median family income can afford to buy, assuming current mortgage rates and a 20 percent down payment for the home. ?Although affordability has been trending downward as both prices and mortgage rates have increased faster than the growth in income, excellent opportunities remain in this market for credit worthy buyers,? said Theo. ?An experienced REALTOR? is still the best way to find those bargains,? he said.

About the WRA
The Wisconsin REALTORS? Association is one of the largest trade associations in the state, representing over 12,500 real estate brokers, sales people and affiliates statewide. Sales estimates for the state are provided by the National Association of REALTORS?, which seasonally adjusts quarterly sales figures. All county figures on sales volume and median prices are compiled by the Wisconsin REALTORS? Association and are not seasonally adjusted. Median prices are only computed if the county recorded at least 10 home sales in the quarter. All data collected by Wisconsin REALTORS? Association are subject to revision if more complete data become available. Beginning in 2010, all historical sales volume and median price data at the county level have been re-benchmarked using the Techmark system which accesses MLS data directly and in real time.
See Complete Article & Statistics

I can help new Real Estate Investors get started

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Finally, I’m hearing it from someone else, that Investors are buying up foreclosure properties for cash. I live this in Real Estate on a daily basis. Good if you’re an Investor, not so good for those trying to sell their homes at reasonable values. I believe it is keeping many trapped between a rock and a hard place. If you would like to get in on Investing, contact me for my skills in helping you get started. I did a study in the Milwaukee Area, and used MLS Statistics to track sales of housing under $100,000 using the type of property (Fannie Mae, Freddie Mac, HUD, etc.) and probability based on how long they were offered to “owner-occupants” only, to determine if they were purchased by investors or owner occupants. My investigation showed that many owner-occupants did take advantage of their exclusive “first right to purchase” period.

(Article)
A Stunning 60% Of All Home Purchases Are “Cash Only” – A 200% Jump In Five Years

tyler durden 0813
Submitted by Tyler Durden on 08/15/2013 17:29 -0400

Remember when housing was the primary aspirational asset for a still existent US middle class, to be purchased with some equity down by your average 30 year-old hoping to start a family in his or her brand new home, and, as the name implies, aspire to reach the American dream? Those days are long gone. Back in those days the interest rate on the 10 Year bond mattered as it determined the prevailing marginal affordability of leveraged real estate. That is no longer the case, at least not for about 90% of Americans, because as Goldman shows, while before the great crisis only 20% of home purchases were “all cash”, since then the number has soared threefold, and currently the estimated percentage of cash transactions (by count and amount) has hit a record 60%. In other words, less than half of all home purchases are debt-funded, and thus less than half of all home purchases are actually representative of what middle-class America is doing.
GS housing cash_0913

Goldman’s take:
Exhibit 4 shows the estimated cash transactions as percent of total home sales both by transaction count and by transaction dollar amount. Relative to the pre-crisis years, percent cash transactions has risen by about 30 percentage points. This change is broadly in line with the increases suggested by DataQuick data. The 30 percentage point increase in percent cash transactions explains almost the entire decline in the ?mortgage per dollar transaction? series (with the remainder explained by small changes in average LTV ratios per mortgage). We do not have data to assess who these all-cash homebuyers are, but presumably investors who have been purchasing distressed properties and turning them into rental units have played an important role.
The WSJ has a few thoughts to add:
The surprisingly large cash-share of purchases helps to explain why home sales have jumped over the past two years despite more muted increases in broad measures of new mortgage activity, such as the MBA?s mortgage application index.

There?s no exact way to know who is responsible for all of these cash purchases, though they are likely to include some combination of investors, foreign buyers, and wealthy homeowners that don?t want to go through the hassle of getting a mortgage before closing on a sale. Mortgage lending standards have sharply tightened up since the housing bubble, with banks scrutinizing borrowers? tax returns and bank statements to verify their incomes and the source of their down payment.
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The Good, the Bad and the Potentially Ugly – Message from the President with Mike Theo

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A Message from the Wisconsin Realtor’s Association President with Mike Theo

The Good, the Bad and the Potentially Ugly

By: Mike Theo
MikeTheoLRG
“Reform? is an interesting word. It connotes improvement, transformation, modernization, restructuring. All positives, right? While well-intended, some reforms can have unforeseen consequences and even be downright harmful.
Congress wants to reform the tax code and the secondary mortgage market. Most Americans ? and likely most REALTORS? ? would agree that reforms to both are needed. But when, where and how these reforms are designed and implemented could dramatically change the real estate marketplace in America. We may be at a critical moment in history. Time to tune in.

Tax reform

Congress has employed a new style of discussion for tax reform this year that they call the ?blank slate.? This approach asks members of Congress to start with a tax code that is blank, with no exemptions or deductions. If they want to keep existing ones or create new ones, they must justify both in terms of encouraging certain behaviors or investments and in terms of tax revenues to the government. It?s a novel, if not refreshing, approach.

The National Association of REALTORS? (NAR) and the WRA have accepted that challenge and have communicated to our congressional delegation asking them to preserve, and in some cases enhance, certain specific real estate tax provisions. The most important of these tax provisions are the mortgage interest and real property tax deductions. These deductions have been among the most popular and widely used part of the tax code for over 100 years. The value of these tax benefits are embedded in home prices and the primary beneficiaries are middle class families. Eliminating them would deflate home prices and discourage homeownership.

We have also asked Congress to maintain the capital gains tax exclusion on the sale of a principal residence. Real estate, mainly in the form of the family home, is the most widely held asset for American families. The current capital gains tax exclusion makes tax filing and retirement saving easier for millions of Americans, and it encourages homeownership. We have argued that this exclusion should not only be preserved but the limits should be indexed for inflation to maintain the value of this benefit over time.

Because the housing recovery is far from complete and many homeowners continue to face foreclosure, short sales or loan restructuring, we are urging Congress to maintain the exclusion of mortgage debt cancellation. The current temporary provision allows families to avoid paying income taxes on ?phantom income? at a time they can least afford to pay. This is an important anti-recessionary measure and should even be made permanent.

Real estate investments play a key role in economic growth and job creation, so we are also asking Congress to shorten depreciation periods for both commercial and residential buildings to reflect the true and useful lives of these assets. Moreover, we have asked that the temporary provision allowing faster write-offs for leasehold improvements be made permanent.

Finally, we are advocating that Congress maintain the deferral from taxes for gains on like-kind exchanges. Our current tax code recognizes that if two properties of like kind are exchanges, nothing economically has changed and thus taxes should not be levied. Encouraging the free flow of capital among investments is good for the economy and jobs and thus the current deferral of gain on the like-kind exchange should be maintained.

Mortgage market reform

Congressman Jeb Hensarling, a Republican from Texas who chairs the House Financial Services Committee, has introduced a bill to significantly restructure financial mortgage markets in America. His plan would dissolve Fannie Mae and Freddie Mac and replace them with a new Market Utility. His bill would also restructure the FHA Mortgage Insurance Program. As currently written, we are asking Congress to oppose these changes.

NAR argues that without some federal government guarantee for a secondary mortgage market, 30-year fixed rate mortgages could disappear. The proposed restructuring of FHA will make many borrowers ineligible for FHA financing, regardless of their creditworthiness or the availability of alternative financing. Moreover, NAR estimates that higher down payments could make 345,000 borrowers a year ineligible for FHA financing, and lower loan limits will limit liquidity and borrowers? access to credit.

Calling all REALTORS?!

Here?s the punch line: It?s time for each and every one of us to engage our members of Congress and help them understand the good, the bad and the potentially ugly impacts of these tax and mortgage finance proposals. And help them make the right decisions for American families, businesses and economy.

Regardless of your political persuasion, these issues are serious, and Congress is giving them serious consideration as we speak. Take a minute to respond to Calls for Action, from NAR and from the WRA, and advocate for these important issues at this critical time. If not for your own enlightened self interest, then in the interests of families and businesses who will suffer or soar based on our success or lack thereof.

Published: August 08, 2013
Original Post:

Economy Poised for a Stronger Second Half of 2013

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July 22, 2013 Posted by Fannie Mae

Economy Poised for a Stronger Second Half of 2013
Despite Rising Mortgage Rates, Housing Remains a Positive Contributor

Pete Bakel
202-752-2034

WASHINGTON, DC ? The ongoing housing recovery coupled with improvement in both consumer confidence and the labor market are expected to boost economic growth in the second half of the year, according to Fannie Mae?s (FNMA/OTC) Economic & Strategic Research Group. The latest jobs report showed steady year-to-date job creation and measures of consumer confidence are at or near recovery highs. Furthermore, despite a sharp increase in mortgage rates during the past two months, home sales have held up and home prices have continued to post gains, helping to keep the economy on a positive?albeit modest?growth path in 2013.

?We are keeping a very close eye on the effect of rising mortgage rates on the housing market and the economy, but our July forecast is little changed from last month,? said Fannie Mae Chief Economist Doug Duncan. ?We continue to see growth in housing, partly due to an increase in existing home sales as buyers choose to act while rates remain near historic lows. Consumer attitudes are improving amid a strengthening employment sector and we should begin to see a moderate pickup in consumer spending. Overall, we expect economic growth to come in at 2.0 percent in 2013, but further momentum later this year should help carry growth in 2014 to an above-par pace of 2.6 percent, the strongest since 2005.?

On the housing front, mortgage rates are expected to continue to rise gradually, averaging 4.7 percent in the fourth quarter of this year?about 40 basis points higher than the June forecast?but the forecast of home sales is little changed, with expectations of an 8.0 percent rise in 2013. However, while the surge in mortgage rates has not significantly hurt purchase mortgage applications, it has led to a marked decline in refinancing applications, which is expected to continue next year.

For an audio synopsis of the July 2013 Economic Outlook, listen to the podcast on the Economic & Strategic Research site at www.fanniemae.com. Visit the site to read the full July 2013 Economic Outlook, including the Economic Developments Commentary, Economic Forecast, Housing Forecast, and Multifamily Market Commentary.

Opinions, analyses, estimates, forecasts, and other views of Fannie Mae’s Economic & Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae’s business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.

Fannie Mae enables people to buy, refinance, or rent a home.

Visit us at: http://www.fanniemae.com/progress

Hope For Homeowners

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mortgagerates1

By NAR 2013 President Gary Thomas

We?ve seen interest rates rising recently.

Rates on 30-year fixed mortgages have gone up almost a full percentage point since reaching record lows six months ago.

REALTORS and consumers are understandably anxious about what this means for the real estate market. While there is currently no evidence of rising interest rates slowing the economy, they will invariably have an impact on loans.

I believe there is reason for hope. Although it?s likely that fewer people will refinance, since they already have low interest rates, banks will still need to make money. As a result, they may need to increase loan originations. To do so, there is a very good chance that lenders could ease credit standards away from over-stringency to ensure the greatest number of qualified buyers have access to mortgage interest.

While you may be hearing concerns from your clients about rising interest rates, don?t despair. Tell your clients that it?s not necessarily bad news for real estate if rising interest rates are balanced with opening credit to more consumers.

We?re hopeful?and it?s more than just a glimmer?that if the economy can recover as much as it has under tight credit conditions, it may do even better as credit steadily returns to normal.

The Number Of US Homes Lost To Foreclosures Plunged 27%

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The Number Of US Homes Lost To Foreclosures Plunged 27%
Published by Business Insider
MAMTA BADKAR JUL. 9, 2013, 10:35 AM 2,983 1

Completed foreclosures in the U.S. fell 27% to 52,000 in May, according to CoreLogic’s latest report. They did, however, rise 3.5% month-over-month.

This number represents the number of homes lost to foreclosure. And there have been 4.4 million completed foreclosures since the financial crisis began.

Shadow inventory fell to under 2 million or 5.3 month supply in April. This is down 34% from its peak of 3 million in 2010, and down 18% from a year ago. The value of shadow inventory was $314 billion as of April, down from $386 billion the previous month.

Meanwhile, 2.3 million mortgages or 5.6% of all mortgages were seriously delinquent. This is where mortgage payments are delinquent for 90 days or more. This is the biggest driver of foreclosure inventory, and was at the lowest level since December 2008.

“We continue to see a sharp drop in foreclosures around the country and with it a decrease in the size of the shadow inventory,” Anand Nallathambi, president and CEO of CoreLogic said in a press release.

“Affordability, despite the rise in home prices over the past year, and consumer confidence are big contributors to these positive trends,? . ?We are particularly encouraged by the broad- based nature of the housing market recovery so far in 2013.”

Here are some details from the report:

Florida has the highest number of completed foreclosures at 103,000. California, Michigan, Texas, and Georgia rounded off the top five.
The District of Columbia had the lowest completed foreclosures at 108. Hawaii had 453 completed foreclosures.
Florida has the highest foreclosure inventory as a percent of all mortgages, at 8.8%. Wyoming had the lowest at 0.5%.
This chart shows the supply of shadow inventory:

foreclosures 2013-07-09 at 10.21.23 am

HUD Information “Avoiding Foreclosure”

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AVOIDING FORECLOSURE
Information provided by the “U.S. Department of Housing and Urban Development” (HUD)
(See HUD Website below for links to additional information)

The Obama Administration has implemented a number of programs to assist homeowners who are at risk
of foreclosure and otherwise struggling with their monthly mortgage payments. The majority of these
programs are administered through the U.S. Treasury Department and HUD. This page provides a
summary of these various programs. Please continue reading in order to determine which program can
best assist you.

Distressed homeowners are encouraged to contact their lenders and loan servicers directly to inquire about
foreclosure prevention options that are available. If you are experiencing difficulty communicating with your mortgage lender or servicer about your need for mortgage relief,

Making Home Affordable
The Making Home Affordable ? (MHA) Program is a critical part of the Obama Administration’s broad strategy to help homeowners avoid foreclosure, stabilize the country’s housing market, and improve the nation’s
economy.

Homeowners can lower their monthly mortgage payments and get into more stable loans at today’s low rates. And for
those homeowners for whom homeownership is no longer affordable or desirable, the program can provide a way out
which avoids foreclosure. Additionally, in an effort to be responsive to the needs of today’s homeowners, there are
also options for unemployed homeowners and homeowners who owe more than their homes are worth. Please read the
following program summaries to determine which program options may be best suited for your particular circumstances.

Modify or Refinance Your Loan for Lower Payments Home Affordable Modification Program (HAMP):
HAMP lowers your monthly mortgage payment to 31 percent of your verified monthly gross (pre-tax) income to make your payments more affordable. The typical HAMP modification results in a 40 percent drop in a monthly mortgage payment. Eighteen percent of HAMP homeowners reduce their payments by $1,000 or more.

Related Information
Avoiding Foreclosure/U.S. Department of Housing and Urban Developm… http://portal.hud.gov/hudportal/HUD?src=/topics/avoiding_foreclosure

Principal Reduction Alternative (PRA):
PRA was designed to help homeowners whose homes are worth significantly less than they owe by encouraging
servicers and investors to reduce the amount you owe on your home. Click Here for more information.
Second Lien Modification Program (2MP): If your first mortgage was permanently modified under HAMP SM
and you have a second mortgage on the same property, you may be eligible for a modification or
principal reduction on your second mortgage under 2MP. Likewise, If you have a home equity loan, HELOC,
or some other second lien that is making it difficult for you to keep up with your mortgage payments, learn
more about this MHA program.

Home Affordable Refinance Program (HARP):
If you are current on your mortgage and have been unable to obtain a traditional refinance because the value of your
home has declined, you may be eligible to refinance through HARP. HARP is designed to help you refinance into a new affordable, more stable mortgage.

    ?Underwater? Mortgages”

In today’s housing market, many homeowners have experienced a decrease in their home’s value. Learn about
these MHA programs to address this concern for homeowners.

Home Affordable Refinance Program (HARP):
If you are current on your mortgage and have been unable to
obtain a traditional refinance because the value of your home has declined, you may be eligible to refinance
through HARP. HARP is designed to help you refinance into a new affordable, more stable mortgage.

Principal Reduction Alternative:
PRA was designed to help homeowners whose homes are worth significantly less than they owe by encouraging servicers and
investors to reduce the amount you owe on your home.

Treasury/FHA Second Lien Program (FHA2LP):
If you have a second mortgage and the mortgage servicer of your first mortgage agrees to participate in FHA Short Refinance, you may qualify to have your second mortgage on the same home reduced or eliminated through FHA2LP. If the servicer of your second mortgage agrees to participate, the total amount of your mortgage debt after the refinance cannot exceed 115% of your home?s current value. Click Here for
more information.

    Assistance for Unemployed Homeowners

Home Affordable Unemployment Program (UP):
If you are having a tough time making your mortgage payments because you are unemployed, you may be eligible for UP. UP provides a temporary reduction or suspension of mortgage payments for at least twelve months while you seek re-employment.

Emergency Homeowners? Loan Program (EHLP), Substantially Similar States: If you live in Connecticut, Delaware, Idaho, Maryland, or Pennsylvania, Click Here for more information about EHLP assistance
provided in your state.

FHA Forbearance for Unemployed Homeowners:
Federal Housing Administration (FHA) requirements now require servicers to extend the forbearance period
for unemployed homeowners to 12 months. The changes to FHA?s Special Forbearance Program announced in July 2011 require servicers to extend the forbearance period for FHA borrowers who qualify for the program from four months to 12 months and remove upfront hurdles to make it easier for unemployed borrowers to qualify. Click Here for more information.

    Managed Exit for Borrowers

Home Affordable Foreclosure Alternatives (HAFA):
If your mortgage payment is unaffordable and you are interested in transitioning to more affordable housing,
you may be eligible for a short sale or deed-in-lieu of foreclosure through HAFA SM.

?Redemption? is a period after your home has already been sold at a foreclosure sale when you can still
reclaim your home. You will need to pay the outstanding mortgage balance and all costs incurred
during the foreclosure process.

FHA-Insured Mortgages
The Federal Housing Administration (FHA), which is a part of the U.S. Department of Housing and Urban
Development (HUD), is working aggressively to halt and reverse the losses represented by foreclosure. Through its

National Servicing Center (NSC), FHA offers a number of various loss mitigation programs and informational
resources to assist FHA-insured homeowners and home equity conversion mortgage (HECM) borrowers facing
financial hardship or unemployment and whose mortgage is either in default or at risk of default.

Click Here to log onto the NSC Loss Mitigation
Programs home page.

Click Here for answers to Frequently Asked Questions about FHA?s loss mitigation programs.

CONTACT FHA
FHA staff are available to help answer your questions and assist you to better understand your options as an FHA
borrower under these loss mitigation programs. There are several ways you can contact FHA for more information,
including:

    Call the NSC at (877) 622-8525
    Call the FHA Outreach Center at 1-800-CALL FHA (800-225-5342)
    Persons with hearing or speech impairments may access this number via TTY by calling the Federal
    Information Relay Service at (800) 877-8339.
    Email the FHA Resource Center
    The Online FHA Resource Center

Tips for Avoiding Foreclosure (brochure)

Click Here to see HUD Website below for links to additional information.

Tom Barrett asks legislators for $2.25 million to help raze abandoned homes

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Milwaukee Journal Sentinel (03/08/13) Walker, Don

With no money available to demolish the city’s growing number of dilapidated and abandoned homes, Mayor Tom Barrett said Friday that the city would ask the Legislature’s Joint Finance Committee to redirect $2.25 million from a national mortgage settlement to address the problem.

City officials are still smarting over an estimated $24.3 million in proceeds from a national mortgage settlement case that was not sent back to Milwaukee, Beloit and Racine that could have been used for demolition and other costs related to the foreclosure crisis. Assistant attorneys general from 48 states, including Wisconsin, reached a $25 billion settlement last year with five banks and mortgage servicers that were accused of mortgage abuses. Wisconsin received a $140 million share of the settlement, $109 million of which went to consumers.

Last year, Attorney General J.B. Van Hollen and Walker said $24.3 million of that settlement would be put into the general fund. Barrett wants $2.25 million of that money to be redirected back to demolish homes that are too far gone to save.

At $15,000 per home, that will only be enough money to demolish 150 homes. Over the next three years, Barrett said raze orders in the city are expected to grow to 1,600 homes, with a cost of $24 million.

“We have a very severe problem right now,” Barrett said.

Between 2010 and 2012, the city took down 494 homes, many of them concentrated in high-crime, poverty-stricken neighborhoods on the north side.

The city also has committed millions of its own money in addition to federal stimulus assistance and a $500,000 grant from the Wisconsin Housing and Economic Development Authority.

Barrett said he may consider asking the Legislature to redirect even more money, a request that would include aid to other foreclosure-ravaged cities in the state, including Be loit, Racine and Kenosha.

Barrett also said the city is reaching out to major banks that control foreclosed properties, businesses and foundations for financial assistance to address the problem. Barrett said he also planned to confer with the Metropolitan Milwaukee Association of Commerce and the Greater Milwaukee Committee.

“We are saying we need more help,” Barrett said.

Barrett made the announcement at an unusual meeting Friday of top city officials, including Police Chief Edward Flynn; Art Dahlberg, commissioner of the Department of Neighborhood Services; Common Council President Willie Hines; Ald. Michael Murphy; and a group of Democratic legislators whose districts include portions of the city.

City officials also had invited Republican legislators who have districts that include some parts of Milwaukee, as well as members of the Joint Finance Committee. But none of those legislators attended the meeting, held at the Police Department’s District 3 headquarters.

Murphy said the state’s decision to keep the $24.3 million angered him. “I see the devastation. I’m tired of the rhetoric,” he said.

“I am beginning to see the wear and tear they have and they face,” Hines said of residents living in his north side district. “The board-up situation is really straining them.”

The reason, explained Flynn, is the linkage of the housing crisis with crime and poverty. City officials have prepared data that show a high correlation between crime and foreclosure in the city.

Murphy and other city officials say the city has lost $3 billion worth of property values since the housing and foreclosure crisis began to take hold in early 2008.

Noting the absence of Republican legislators at the meeting, Barrett said some of their constituents who live in Milwaukee are bearing the economic cost of foreclosure and abandoned homes.

“This does have an impact on their constituents,” Barrett said.

In addition to seeking state funds and approaching banks, businesses and foundations for additional funds, Barrett said his administration had begun to approach major lenders in the city asking them to help homeowners avoid foreclosure. In addition, the city has hopes of winning the Bloomberg Challenge, a nationwide competition worth $5 million. Milwaukee’s proposal seeks to transform foreclosed properties that would be razed into urban farms and distribution centers to provide a new supply chain for nutritious food.

Story from JS Online
Link to original story

Metro Milwaukee Home Sales Up 16.4% in February 2013

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Home Sales Up 16.4% in February

March 12, 2013 ? The 4-county Metropolitan Milwaukee housing market continued plowing through the winter in February, posting a 16.4% increase in sales over February 2012. There were 960 sales in February, the most for that month since 2007 (1,033), just before the Great Recession began; and marking the 20th month in a row of increased home sales.

Click here to view the graph showing actual sales over the last 20 months. Note the higher level of sales in January and February 2013 compared to the same months in 2012, indicating a much stronger beginning to 2013.

While the continued housing recovery is certainly welcome news, and hopes are that the trajectory of sales depicted in the graph above for 2012 follows into 2013, there is concern over the very low levels of inventory in the market.

The market had 7.08 months of inventory in February (calculated by the number of active listings divided by the average monthly sales over the previous 12 months), which is well below the 11.63 months in February 2012. Only 1,952 homes were listed in February 2013, down 18.3% from a year earlier.

REALTORS? are listing homes to be sure, just not at the rate the market indicates it needs to satisfy current demand. Confusion and skepticism among potential sellers over what price their home might sell for seems to be the main culprit in their hesitation to list.

Sellers will undoubtedly not fetch prices from the peak of the market, however, prices have stabilized in most communities. And, due to the low levels of inventory the length of time a house is on the market has shrunk significantly.

The law of supply and demand would seem to dictate prices should increase soon. With a low supply of homes, stable or increasing demand, historically low interest rates, and positive external factors such as consumer confidence and employment, prices should be pushed upward as buyers outbid one another for a listing.

However, the overall economy is not blazing any trails, job creation is tepid, mortgage applications are detailed and time consuming, and multiple offers are bidding up to a property?s asking price and often including seller concessions. In short, the market is still working through a few challenges that may be holding overall growth back.

While the market is strengthening, it is still too early in the year to say with any confidence that the Milwaukee market will see universal price increases this year. It is still a buyers? market, but just slightly.

This was sent by the Greater Milwaukee Association of REALTOR’s?.

?2012 Greater Milwaukee Association of REALTORS?. All Rights Reserved.
12300 W. Center Street Milwaukee, WI 53222
Phone: 414-778-4929 Fax: 414-778-4920